News Feature | September 16, 2013

Walgreens Acquires Kerr Drug, Expanding Its Brand Prior To Obamacare

Purchase leads to new opportunities for retailer as primary healthcare provider

Riding the coattails of its announcement of a new, long-term partnership that will bring faster lab results to stores, Walgreens announced its purchase of a competing drugstore and pharmacy. Raleigh, NC-based Kerr Drug will bring 76 new stores to Walgreens 8,100+ nationwide locations. The acquisition also brings Kerr Drug’s $380 million in sales during 2012 to Walgreens already enormous sales figure of $72 billion for the year. Financial details of the transaction remain undisclosed.

The deal improves Walgreens’ presence in the North Carolina market, especially in small communities, where the drugstore chain sees a giant opportunity to expand its services. “We are closely aligned on the important task of expanding the health care role that community pharmacists can have with their patients, and we share the common goal of stepping out of the traditional drugstore format to create a new experience for our customers,” says Walgreens CEO, Greg Wasson.

In July, Walgreens announced plans to rebrand its “Take Care Clinics” into “Healthcare Clinics” in an effort to better reflect the change in medical services and assets it offers. These additional services and assets include the management and treatment of chronic conditions — diabetes, hypertension, and high cholesterol, to name a few. These clinics are staffed by advanced degree nurses (nurse practitioners) and aim to expand Walgreens’ role in healthcare past common ailments like pink eye and strep throat.

This move, along with the purchase of Kerr Drug, is part of an aggressive campaign by Walgreens to expand new business and increase the company’s delivery of primary care services. This may prove beneficial for Walgreens as new federal healthcare mandates, “Obamacare,” launch in January, leading to millions of Americans scrambling to find primary healthcare. Walgreens looks to make a play, along with competitors like Walmart and CVS/Caremark, on this new stream of almost unlimited patients looking to find a limited amount of doctors. The hope is to turn retailers into care facilities for patients unable to find a primary care doctor.